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Governance of compensation
Compensation provisions in the Articles of Associsation
The Company's Articles of Association1 contain the following compensation provisions required by the OaEC:
- concerning approval by the general meeting of the maximum total amounts of compensation of the Board of Directors and of Executive Management (Art. 15);
- concerning the principles of compensation payable to the members of the Board of directors and of Executive Management, as well as the allocation of equity securities to them (Art. 25 and 26);
- concerning the additional amount of compensation for Executive Management members who will take an Executive Management position or assume additional duties after the compensation has been approved by the general meeting (Art. 15 (5)).
Nomination and Compensation Committee (NCC)
The NCC shall also assist the Board of Directors in determining the compensation of Directors and Executive members (Board of Directors and CEO), and with the audit of the Compensation Report. The NCC particularly has the following duties related to “compensation”:
- recommendations on the general compensation policy of Ina Invest Holding Ltd Group;
- recommendations on compensation for the Board Members and CEO;
- recommendation on the financial targets under the Short-Term Incentive Plan (STIP) in accordance with the annual budget;
- review and approval of the CEO's performance under the STIP, on proposal by the Chairman;
- review of the Compensation Report;
- regular review of the amount and components of the compensation of the Board Members and CEO
Unless expressly agreed otherwise, the Board of Directors shall retain the decision-making authority.
The NCC consists of three independent, non-executive BoD members who are elected annually and individually by the AGM. The NCC Chair is appointed by the Board of Directors (from among the elected NCC members). As pointed out in the Corporate Governance Report, the NCC in the reporting period consisted of three members: Marie-Noëlle Zen-Ruffinen (NCC Chair), Christoph Caviezel and André Wyss.
The NCC meets as often as business requires but at least two times per year. During the financial year 2021, the NCC held three ordinary meetings and various supplementary, shorter meetings and telephone calls. All meetings and conference calls were attended by all members of the NCC as well as the Chairman of the Board of Directors. The NCC reports to the Board of Directors at the BoD meeting following an NCC meeting. This procedure ensures that the Board of Directors is informed promptly and appropriately of all essential matters within the NCC’s area of responsibility. In addition, all NCC documents (e.g. agenda, minutes, presentations, etc.) are available to the Board of Directors.
As a rule, the Chair of the Board of Directors and the CEO attend the NCC meetings. The Chair of the NCC may invite other executives or external advisors as appropriate. The NCC regularly holds private sessions (i.e. without the presence of members of the Management Board or third parties). Furthermore, executives (and the Chair of the Board of Directors) do not participate during the sections of the meetings where their own performance and/or compensation are discussed.
Compensation Governance and Shareholders’ Involvement
The following table provides an overview of the division of responsibilities between the Annual General Meeting, the Board of Directors, the NCC, and the CEO:
| Subject area/Responsibility | NCC | Board of Directors | Annual General Meeting |
| Compensation policy | proposes | approves | |
| Compensation report | proposes and reviews | approves | advisory vote |
| Maximum total compensation of the Board of Directors for the period until the next annual general meeting | recommends | reviews and proposes | approves |
| Maximum total compensation of the CEO for the next financial year | recommends | reviews and proposes | approves |
| Individual compensation of the BoD members within the limits of the total amount approved by the GM, of the Articles of Association and the law (including any portion in shares, the related terms and conditions, the allocation date, valuation and restriction period) | recommends | decides | |
| Financial and individual targets of the STIP for the CEO | recommends | decides | |
| CEO's performance under the STIP | reviews and decides (on proposal by the Chairman of the Board of Directors) | ||
| Individual compensation of the CEO within the limits of the total amount approved by the GM, of the Articles of Association and the law (base salary and variable compensation under the STIP) | recommends (in cooperation with the Chairman of the Board of Directors) | decides |
The NCC has appointed HCM International Ltd. (HCM), an external, independent consulting firm, as the advisor of the NCC and Board of Directors on specific compensation issues. HCM holds no further mandates with Ina Invest Holding Ltd.
Each year, based on the recommendation of the NCC, the Board of Directors shall decide on the proposal made to the general meeting (i) concerning the maximum total compensation of the Board of Directors for the period until the next annual general meeting and (ii) concerning the maximum total compensation of the CEO for the next financial year.
The individual compensation of the Board Members and of the CEO shall be reviewed annually by the NCC.
The NCC Chair shall promptly report on significant proceedings, recommendations and resolutions of the NCC to the Chair of the Board of Directors, unless the Chair of the Board of Directors participated, and shall report on same at the next Board of Directors meeting. The minutes of the NCC meetings shall be forwarded to all Board Members.